Mississippi regulators have moved to limit homeowners’ insurance premium hikes that result from changes in an insurer’s fire grading system.
Mississippi Insurance Commissioner Mike Chaney has instructed insurers that during any 12 month period they may only raise an insured’s premiums due to a change in their fire-risk classification to one classification change, or 15 percent, whichever is less.
Fire grading systems are used by insurers to assess the risk of fire damage to any homeowner. Among the factors in the grading systems are how far a home is located from a fire station and if it is located in a rural area as opposed to an urban area.
Insurers are increasingly using computerized geographic information systems (GIS) to assess a homeowner’s risk for fire damage. One of the most popular, Location, is offered by Insurance Services Office (ISO).
Chaney said these systems are resulting in changes where homeowners previously thought to have a favorable classification are having their classifications substantially lowered.
“The significance of this is that affected homeowners may face abrupt and substantial increases in their homeowner insurance rates through no fault of their own,” he said.
Topics Pricing Trends Homeowners Mississippi
Was this article valuable?
Here are more articles you may enjoy.
Flood Insurance Gap Will Squeeze Local Governments and Homeowners, Moody’s Says 
How Insurers Know When It’s Time to Scale AI 
Florida-Based Safepoint Withdraws IPO Just as it Was Expected to Launch 
Need Wind Mitigation? New Florida Insurer Wants to Help With That 
